Where Not How: Commonwealth Court Upholds Oil and Gas Zoning Ordinance

November 12, 2018

By: Alan T. Shuckrow and Alexis M. Wheeler

On October 26, 2018, The Commonwealth Court handed down another opinion in a recent line of case law developing oil and gas land use and environmental regulation in Pennsylvania, Frederick v. Allegheny Township.[1] Allegheny Township is an en banc decision penned by President Judge Leavitt, with Judges McCullough and Ceisler authoring dissenting opinions. Allegheny Township involves an ordinance permitting oil and gas development as a “use by right” in all zoning districts in the Westmoreland County Township.

In 2014, landowners appealed a zoning permit issued to a gas company for an unconventional gas well in an Agricultural/Residential Zoning District of the Township. Approval under the ordinance was subject to a number of conditions, including the issuance of a DEP permit and meeting state-imposed setbacks under the Oil and Gas Act, which was partially enjoined under Robinson Township II.[2] The objectors argued that the gas well use was incompatible with the underlying district and that their rights under the Environmental Rights Amendment (ERA) of the Pennsylvania Constitution, as proximate land owners in a residential district, were infringed by the “industrial” nature of the well.

The objectors also argued that, under the PA Supreme Court’s recent ruling in PDEF II, [3] the Township had an affirmative duty to prevent environmental degradation within its boundaries.  The gas company argued that the property, as private land, was not part of the corpus of the public trust for which the Commonwealth (and its municipalities) acts as trustee.

In reaching its decision, the Commonwealth Court emphasized that oil and gas operations provided for the “livelihood and way for life” for many property owners in the Township’s residential and agricultural districts. [4] The court found that the objector’s “affirmative duty” argument would create regulations duplicative of existing laws in the Commonwealth. Therefore, objectors’ concerns for the potential harm to the environment would have been properly addressed with the state agency that (DEP) issued the operating permit to the gas company.

In the end, the Commonwealth Court concluded that it must “presume that the Township’s Board of Supervisors ‘investigated the question and ascertained what is best for…the good of the people’” when it enacted the ordinance.[5]  Further, “that oil and gas drilling is authorized in every zoning district in the Township does not mean that it will take place everywhere.” The court noted that the setback provisions set forth in the Oil and Gas Act remain in effect.  To this end, the court held that where a zoning ordinance regulates where oil and gas drilling is to take place, and not how it is to take place, the regulation will be upheld unless it is clearly arbitrary or unreasonable.

The two dissenting opinions from Judges McCullough and Ceisler are strongly worded and set the stage for the Supreme Court to potentially accept this case. For now, municipalities should carefully review the Allegheny Township decision but be on the lookout to see what the Supreme Court does with this case.

For more information about zoning, municipal or oil and gas laws, please contact Alan T. Shuckrow at ashuckrow@smgglaw.com or Alexis M. Wheeler at awheeler@smgglaw.com  or at (412) 281-5423.

[1] — A.3d —-, 2018 WL 5303462 (Pa. Commw. Ct. 2018).

[2] 83 A.3d 901 (Pa. 2013).

[3] 161 A.3d 911 (Pa. 2017).

[4] The court cited Robinson Township II for the proposition that “development promoting the economic well-being of the citizenry obviously is a legitimate state interest.”

[5] Citing Khan v. State Board of Auctioneer Examiners, 842 A.2d 936, 947 (Pa. 2004).